It’s not every day that I put out a ‘buy’ recommendation for a mining stock. But a chance look at Silver Wheaton’s long-term chart brought me to the realization that it may be time. The bear-market pattern shown, with a Hidden Pivot target at 9.46, suggests bulls will enjoy good odds bottom-fishing there. There are some alternative point ‘A’ highs that I could have used to calculate a tradable target. However, my gut feeling is that the one I’ve selected will produce a ‘D’ low that is both precise and reliable. It is the last ‘stick-up’ high before SLW went over the falls, and that’s why I’ve chosen it. Accordingly, I’ll recommend bidding 9.52 for 400 shares, stop 9.36. We are risking about $64 theoretical here, and the stocks could fall a further $1, to 8.50, if our stop is hit. I’d want to attempt bottom-fishing there as well, so leave room for a second try. ________ UPDATE (February 2, 1:54 a.m. EST): We’ll have to catch this stock on-the-run, since it has taken off after trading no lower than 10.11. My immediate rally target was 12.02, but if SLW gnaws through this Hidden Pivot without difficulty, it would be a bullish sign going forward._______UPDATE (February 4, 12:55 a.m.): Careful! The stock’s insane rally is headed into double resistance in the form of a Hidden Pivot at 13.00 that comes from the daily chart, and an important high at 13.10 recorded in January.______UPDATE (11:20 p.m.): With an upward lurch at the opening, SLW blew past both of the resistance points noted above with the greatest of ease. The rally stalled almost precisely at the 13.66 target of this pattern on the hourly chart: A= 10.11 (1/21); B=12.14 (2/1); and C=11.63. The move was impulsively bullish on the intraday charts, suggesting that any weakness in the days ahead be used to initiate a long position or increase the size of an existing one.
